If the Senate passes a bill to end the big-bank subsidy and nobody notices, does it matter?

Last Friday, among the flurry of amendments that the Senate passed before it adjourned for a two-week recess, the Brown-Vitter amendment, which pledged to end funding advantages to banks with more than $500 billion in assets, passed in a 99-0 vote.

Great, right? Senator Vitter, one of the co-authors of the amendment, stated afterwards, “This is a really impressive sign that we mean business on ending too-big-to-fail.”

Not so fast. This amendment isn’t likely to have any practical consequences, for now. Nevertheless, its real impact is in adding to the mounting pressure against U.S. banking institutions.

Why the amendment is largely symbolic

Officially, the amendment merely calls for an end to any subsidy or funding advantage, but given that Congress doesn’t directly give money to banks, the mechanism through which the Senate is supposed to end this implicit subsidy is hazy. Senator Sherrod Brown, one of the co-authors of the bill, has hinted that future legislation may demand that big banks meet certain capital requirements or pay higher fees.

However, even further legislation to give teeth to this amendment is unlikely. This is because the amendment essentially admits that Dodd-Frank is inadequate, a debate that the White House doesn’t want to open up again and a point that many financial sector lobbyists argue isn’t fair to make just yet. Secretary of the Treasury Jack Lew even told Politico recently, “We now have a set of provisions in place which is working to a great extent. It’s not fully implemented. We need to finish implementing it.”

Growing pressure against big banks

Although the amendment is unlikely to break up big banks, it does contribute to anti-big bank sentiment that has been gaining momentum in the last few months.

In February, Bloomberg View estimated that big banks receive an implicit subsidy of $83 billion, which drew public attention after Senator Elizabeth Warren cited this figure during a Senate Banking Committee hearing.

In early March, the Senate’s Permanent Subcommittee on Investigations released a 300-page report on JP Morgan Chase’s failure to reign in risky trading practices that led to the infamous “London Whale” scandal, in which one trader’s aggressive trades led to a $6.2 billion loss.

And now, this unanimous vote in the Senate is yet another sign of public suspicion of big banks.

As CEO of pro-reform group Better Markets, Dennis Kelleher told Politico earlier this month, “These banks really are one major blow up away from a massive political shift.” The passage of the Brown-Vitter amendment, despite its lack of any immediate impact, shows that this growing movement to break up the banks is not fading away anytime soon.